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Earnings roundup in private and public bank holding companies

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  • Yang, Ziyun
  • Dong, Xiaobo

Abstract

In this study, we compare the relative tendencies of public versus private firms to round up earnings in a setting of the banking industry. This industry consists of a large number of public and private bank holding companies (BHCs) that face the same regulation environment. In both the full sample and the size-matched sample, we find evidence that public BHCs show a greater tendency to round up the second digit of earnings than do private BHCs. Our study contributes to the current debate on the financial reporting quality of public versus private firms by providing evidence supporting the “opportunistic behavior” hypothesis.

Suggested Citation

  • Yang, Ziyun & Dong, Xiaobo, 2015. "Earnings roundup in private and public bank holding companies," Advances in accounting, Elsevier, vol. 31(1), pages 96-99.
    • Handle: RePEc:eee:advacc:v:31:y:2015:i:1:p:96-99
    DOI: 10.1016/j.adiac.2015.03.004
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    References listed on IDEAS

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    1. Ball, Ray & Shivakumar, Lakshmanan, 2005. "Earnings quality in UK private firms: comparative loss recognition timeliness," Journal of Accounting and Economics, Elsevier, vol. 39(1), pages 83-128, February.
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    Cited by:

    1. Tran, Arthur M. & Griffiths, Mark D. & Winters, Drew B., 2023. "Small bank managers are prudent: A Benford’s Law approach to analyzing loan loss allowances," Journal of Economics and Business, Elsevier, vol. 125.

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